Q2: Revenue Growth of 403.5% on Expanding EBITDA Margins… Continued QoQ growth even with distribution deals previously announced being pushed out into Q3. Throw on top of that expanding EBITDA margins that will deliver strong EBITDA positive quarters from here out.
Looking under the hood it looks really promising with 44% YoY organic growth of its legacy brands which continues its real strong start of the year for organic growth on top of the Central Roast and Lovechild acquisitions. With the sector as a whole growing at 11% and Greenspace growing at 4x organically the rate of the sector bodes really well for the future.
With the distribution deals kicking in hard for the second half of the fiscal year with the Starbucks deal firing up in Q4 the second half of the year looks torqued for a big ramp in revenues and EBITDA. Well over 40M in Revenue is easily within site for the remainder of the year and I can make the case for 55M in 2017.
With Balance sheet capacity and faith from the capital markets to execute its business model things are looking bright for Greenspace as the have demonstrated their ability to raise capital this summer.
Trading at only 1.2x Sales (2016) and only 0.9x Sales (2017)when other organic plays in the states have been taken out at 2x – 2.5x Sales recently would put Greenspace at 2.20/Share on 2016 numbers alone.
If it sells off on the back of the slow to roll out distribution deals I will be adding aggressively as the business model is intact and the runway for growth hasn’t changed.
LONG